March 22 (Bloomberg) -- The failure of German Chancellor
Angela Merkel and state leaders to agree on how to contain
rising power prices prolongs a period of insecurity for
investors, the country’s BDEW utility lobby said.

Six months before federal elections, Merkel and state
leaders failed to agree on an overhaul of the country’s EEG
clean-energy subsidy law and stop electricity prices from rising
at talks in Berlin yesterday.

“Adjourning the discussions into the next months instead
of making concrete decisions is not acceptable for the energy
industry,” Hildegard Mueller, head of the BDEW that represents
utilities including EON SE and RWE AG, said in an e-mailed
statement. “The phase of insecurity for investors, consumers
and the energy industry is being prolonged.”

Merkel is working to prevent a voter backlash after costs
for Germany’s clean-energy expansion spiraled as the government
strives to more than triple the share of renewables in the power
mix by 2050 while phasing out nuclear generation. Consumers in
Europe’s biggest economy have seen power bills climb after a fee
they pay for renewables jumped 47 percent to a record 5.28 euro
cents a kilowatt-hour on Jan. 1.

The government and state leaders agreed to transfer to
federal authorities planning rights for power grids to speed up
projects. In a boon to clean-energy investors, Merkel, after
pressure from the opposition, vowed not to make retroactive cuts
to renewable subsidies. The chancellor said she was
“skeptical” regarding an opposition proposal to reduce power
taxes by 25 percent to save consumers 1.6 billion euros ($2.1
billion).

The government and state leaders will continue talks on how
to stop power prices from rising in a bid to find an agreement
before the summer recess, they said. They probably won’t tackle
a comprehensive reform of the EEG clean-energy until after the
Sept. 22 elections, Merkel said.